Apple is not pulling back on stock buybacks

The Apple Inc logo is seen at the entrance to the Apple store in Brussels, Belgium November 28, 2022.

The Apple Inc logo is seen at the entrance to the Apple store in Brussels, Belgium November 28, 2022.

In a quarterly earnings release, Apple announced (pdf) it would allow $90 billion in share buybacks this year, in line with last year’s figure, as the company continues to flex its financial muscle in the face of declining revenue.

The Cupertino-based tech giant saw a 3% decline in revenue in its the second-fiscal quarter of 2023, because of falling Mac and iPhone sales. For now, the company will continue its rapid pace of share buybacks, which increases returns for shareholders. It will likely continue share buybacks until its cash is equal to its debt.

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Currently, Apple has $54 billion in extra cash, and Morgan Stanley estimates that the company will use up its extra cash in three-and-a-half years.

Of all the companies in the world, Apple is well-known for having the most cash on hand. This is in large part because it wants to avoid taxation by bringing that cash (mostly generated and kept overseas) back into the US.

It’s also because the company wants a cheap source of funding, useful in a rising interest rate environment, and to be able to quickly fund research and development.

This story is developing and will be updated.

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